As finales go, it was unconventional to say the least. Dame Cleo Laine, wife of jazz legend Sir John Dankworth, had returned from King Edward VII hospital in London, where hours earlier her husband of 50 years had died.

Star names were waiting to entertain a 400-strong crowd at The Stables in Wavendon, Buckinghamshire, the venue set up by Sir John and Dame Cleo 40 years earlier. The stars – including Victoria Wood, Prunella Scales and Paul O'Grady – were told that Dankworth had died but advised that the show must go on, and that the audience must not know. Dame Cleo, 82, was among those performing. The show was memorable, the audience was enthralled.

Then came the twist. Dame Cleo stepped forward and in hushed tones broke the news of her husband's death.

The announcement drew gasps of disbelief from Saturday night's audience.

Monica Ferguson, chief executive of the venue, in the grounds of the Dankworth home, said: "People I spoke to afterwards were visibly shaken and moved. The sheer grit and will of the family, to go in those circumstances, was astounding."

According to Ferguson, Dame Cleo had not wanted to "bring the audience down". She had insisted Sir John would have wanted the concert to be a celebration.

Maureen Lipman, also performing, said Ferguson had told performers before the concert: "We don't want a wake, we want a celebration."

Stephen Clarke, chairman of the charity that now owns the venue, said: "It is a fitting tribute that on the day of Sir John's death we celebrated on stage the 40th anniversary of The Stables with some of the many artists who have performed with Sir John here."

The saxophonist had been ill for several months. Better known as Johnny Dankworth before he was knighted in 2006, he started his own jazz orchestra in the 1950s and went on to work with Duke Ellington, Nat King Cole and Ella Fitzgerald.

He was also a prolific composer, writing the theme tune for TV shows The Avengers and Tomorrow's World, and films including The Servant and Saturday Night and Sunday Morning.

Jazz star Jamie Cullum paid tribute to the musician on his Twitter page, calling him a genius.

He added: "Sir John Dankworth - a great man and one of our finest musicians and composers has died. Rest in peace sir."

Jazzwise magazine hailed the performer as "one of the totemic figures of British jazz" and the country's "first major jazz musician".

His agent, Jim Murtha, said: "For British jazz and jazz around the world, I believe John has become such an international figure, particularly since he became Sir John Dankworth a few years ago."

Sir John met his wife in 1950 while auditioning singers for his band, the Dankworth Seven. They married in 1958.

He was taken ill last October at the end of a US tour with his wife. The couple cancelled a number of UK concert dates for the following month, although he did return to the stage at the London Jazz festival, playing his saxophone from his wheelchair at the Royal Festival Hall.